Initiating Coordination

Abstract

How do rational agents coordinate in a single-stage, noncooperative game? Common knowledge of the payoff matrix and of each player’s utility maximization among his strategies does not ground coordination. What background conditions and principles of rationality suffice? This paper argues that utility maximization among intentions and then acts leads to a payoff-dominant Nash equilibrium. It uses principles of individualistic reasoning to justify a method of initiating coordination. Its account of strategic reasoning elaborates a classical treatment of coordination.